How to Write a Business Proposal in 6 Steps

A business proposal is a document used to offer specific goods or services to leads at a defined cost. They are typically used by B2B companies to win new business and can be either solicited or unsolicited. Effective business proposals have an executive summary, key project details, and require a client signature.

A customer relationship management (CRM) tool like Salesforce Essentials makes it easy to prepare and manage active business proposals while also letting you track email opens and clicks, view customer information, and monitor your calendar schedule, all in one place. This speeds up the process so you can focus on turning leads into loyal customers. Sign for a 14-day free trial, no credit card required.

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Free Business Proposal Template

An excellent business proposal includes several key elements, including an executive summary, project details, timeline, terms, and cost, as well as a conclusion and signature field for the prospect. Business proposal templates ensure that none of these components are missed, making them a critical tool for any small business. Visit our article on Free Business Proposal Templates That Win Deals to download a free template in Google Slides or PowerPoint formats.

Here are the six steps to writing an effective business proposal:

1. Gather the Information You Need

When a hot business opportunity becomes available, you may feel pressure to get your proposal sent over as soon as possible. While you definitely want to send it sooner rather than later, taking some time to learn about the client and project first will help you craft a proposal that’s more likely to be accepted. This will inform the key elements to include in your proposal and create a more accurate and effective proposal that results in a closed deal.

For example, if a potential client has multiple offices or locations, you may need to visit more than one of them before you can accurately assess the project. In this scenario, timing requires the right balance: You don’t want to send a proposal prematurely—especially if you can’t accurately estimate costs—but you also don’t want to send it too late and be beaten out by the competition.

Some of the key questions you need to answer before writing your proposal include:

• Who are the buyers? The person you met may not be the final decision-maker. Determine who else may be involved in the process. If possible, ask the prospect to describe their decision-making or approval process.
• What is the pain point? Research your competition to identify potential weaknesses or gaps. Ask the prospect questions about their past experience with similar products or services to identify their pain points and how you can solve them with your products and services.
• Is there a budget? Ask the prospect if they have a target price in mind or if there is a budget for the project. Answering this question will help you avoid wasting time on proposals that have no chance for profit.
• Is there a deadline? Many companies set internal deadlines for purchasing decisions in order to hit production or launch schedules. They also may be motivated to buy at specific times of the year. Ask if they have a deadline to help pinpoint the time frame.
• What is your best solution to their problem? Determine which of your offerings provides the most benefit based on who the buyers are, what they need, what their pain points are, and their purchasing schedule.
• What are your costs if the proposal is accepted? Calculate the costs, such as labor or materials you will incur as a result of your proposal, and estimate the total projected revenue for your company.

One solution is to include caveats. These will allow you to send your proposals quickly while also protecting you from unexpected turns the project may take. However, be careful not to add too many because it can make your proposal appear underdeveloped, which may take you out of the running before you start.

“A simple rule of thumb is to send a proposal after your first meeting. Include a personal note that acts as a follow-up: ‘Hey, it was great connecting the other day,’ and then attach your proposal.”

– Andy Freivogel, Science Retail

Pro tip: CRM systems are used to store and manage your leads and contacts, so it’s the ideal place to manage your proposals as well. In fact, you can incorporate your business proposal into your sales pipeline stages to help track your proposal activities and move your prospects through the sales cycle.

For example, Salesforce Essentials lets you store customer contact information, meeting notes, documents, and emails, all in one place. This makes it easier, and more efficient, to manage sales activities, including proposals. Sign up for a 14-day free trial today.

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2. Define Project Objectives & Scope

The first thing you want to do before outlining the scope of your project is to define the objective of your business proposal. It’s important that you know and can articulate your objective so you never lose sight of the reason you’re writing the proposal. This helps shape your outline and your business proposal. It is also a good practice to state the objective, either in your introduction or in the executive summary of your proposal.

Know the Objective of Your Business Proposal

To create a proposal objective, ask yourself the following questions:

• What is the purpose of the proposal?
• What are the needs or pain points of your prospect or customer?
• What problems are you solving with your products and services?
• How does your solution solve your customer’s or prospect’s problems?

Once you’ve answered these questions, create a proposal objective statement that is centered around your customer’s or prospect’s needs.

Example Objective Statement

Outline the Project’s Scope

The scope of the project is the summary of its deliverables and should take features, functions, tasks, costs, and schedules into account. This step will define the statement of work (or the “who, what, where, when, how, and why”) as it pertains to your proposal and financial costs. While you can answer these questions in your head, it’s a better idea is to write them down as a separate note or record the answers in your CRM before starting your proposal.

To outline the project’s scope, answer the following questions:

• Who: Who will do the work, who will oversee the work, and who does the customer call if there is a problem?
• What: What solutions need to be delivered, what will be required to get it done, what can the customer expect, and what will it cost them?
• Where: Where will the work be done, and where will it be delivered?
• When: When will you begin, when will key milestones be scheduled, when will the project be completed, and when is the payment due?
• How: How will work be done, how will it be deployed, how will it be managed, how will you achieve quality assurance and customer satisfaction, how will risks be mitigated, how long will it take, and how will the work benefit the customer?
• Why: Why have you chosen the strategies and alternatives you have selected, and why should the customer select you?

Writing these out will give you a head start since these answers will make up the bulk of the business proposal. It also gives you final confirmation that you have the necessary resources to complete the project—or it will point out any major snags before you get too invested.

3. Calculate Your Labor & Costs

Early on, you want to consider how much the project will cost—and how much to charge the client. Many businesses use a simple formula to estimate their labor costs: Take a mental walk-through of the project and write down the realistic number of hours it will take for each task. Add this up, and multiply it by 1.5.

For example, if you estimate a project will take 10 hours, write it down as 15 hours in your proposal (10 * 1.5 = 15). Why overestimate? This is because projects often have unforeseen twists and turns, and adding this extra time will help account for any potential obstacles and build in a contingency budget.

Plus, if everything goes smoothly and you wind up below your estimated hours, you can always offer bonus work, or bill your client a lower amount. Both will result in delighted customers.

4. Begin Drafting Your Business Proposal

Now it’s time to dive into the actual proposal document. Proposals tend to follow a loose formula. They start with an introduction that summarizes your business and the project, followed by a body that goes into all the details (including a pricing table, photos, and charts), and a conclusion that tells the customer how to proceed.

Including the signature page, good business proposals should have between six and seven sections. Delving into this part of your proposal can certainly take a while. However, we have developed a business proposal template you can download to help you get started.

The six sections you should address in your business proposal include:

Section 1: Introduction

Start by introducing your company and mission in a way that relates to your potential client’s needs. You can include a brief story that gives your client a feel for your brand’s character and helps foster trust. Highlight what distinguishes your company, your accomplishments, your credentials, and any awards.

The length of your introduction should be a matter of common sense. If you’re proposing a one-day carpet cleaning job, don’t spend more than a few sentences describing your business. If your contract is poised to last several years, however, you’ll probably need to spend more time explaining your core business values. Nonetheless, try to always keep it under one page. If your timeline is tight, you can hire a writer to develop a polished introduction.

Sample introduction

Section 2: Executive Summary

The executive summary is one of the most significant sections in your proposal. This is where you should present the case for why you are the right company for the job, and give the reader the key message of the proposal. You should not try to summarize every aspect of the proposal, but rather focus on the conclusions you want the reader to reach after reading it.

Use direct, factual language that is objective and persuasive. This section should also be kept under one page.

Sample executive summary

Section 3: Table of Contents (optional)

A table of contents can be useful for longer proposals with many details. List each section (and subsection) with their corresponding page number. In general, we recommend keeping your proposal as short as possible—most proposals shouldn’t need this extra section.

Section 4: Body

Once you have presented your overall case in the executive summary, you can outline the specifics of your proposal. This is where you can answer the “who, what, when, where, how, and why” questions that you identified in step two. Include information on scheduling, logistics, and pricing. You can use data charts to illustrate essential concepts and can also include testimonials from past clients and a link to your website.

A good way to start is with the project details, including a pricing grid or breakdown of the timeline. A pricing grid itemizes the products or services involved in the proposal as well as their price and any terms related to their delivery in an easy-to-read format.

Project details and timeline sample

You also might want to close the body with a signed agreement form that can act as a contract agreement. This is a good tactic for helping to speed the close along.

Sample agreement page

The body is also where you include caveats or disclaimers about the type of work you can produce. Also known as your terms and conditions and is one of the most critical parts of your business proposal. It is also one of the most complex arts to master.

It’s a common tendency for clients to expand (knowingly or unknowingly) their requirements once engaged with a provider. For example, let’s say you’re a business hired to set up internet and Wi-Fi. While on the job, you’re also asked to set up their voice-over-internet-protocol (VoIP) phones.

After all, it’s just a matter of plugging Ethernet cables into the phones. Weeks later, however, you start getting calls about phones that aren’t working. Unintentionally, you made yourself liable for a system that’s not even your specialty.

To avoid this type of responsibility, you can write caveats about the type of work you offer and your pricing.

An example of a caveat might be:

“[Your Company Name] will service all technical issues involving [Your Specialties]. We reserve the right to charge extra in the implementation of an issue that is not listed above.”

On the flip side, you don’t want to include so many caveats that your client is scared away. This is where the “art” of how to write a business proposal comes in—include all necessary disclaimers, but word them in a way that still shows the value you’ll bring to a business.

Sample of terms or caveats

Section 5: Conclusion

Once you have outlined the details of your proposal, re-emphasize the excellent results your company can provide. You should end with a call to action that encourages the reader to contact you or visit your website for more information. Ideally, you want your client to take immediate action on something, even if it is something small.

Sample conclusion page

Section 6: Appendix

The appendix is an optional section that you can use to include information that might not fit well in the body of your proposal. For example, you can include staff resumes or additional graphs, projections, and customer testimonials.

Pro tip: As you write your proposal, you’ll probably keep referring back to old emails and notes to find the “who, what, where, when, and how.” A CRM is a great place to store these important pieces of information. In particular, custom fields remind you and your employees to collect this information and make it easy to access in the future.

For example, an IT company needs to track pre-sale owners for their deals to add the pre-sale engineers by name to their proposals—and to pay their commissions. By adding these fields to the opportunity in their CRM, the information is readily accessible when it comes time to write a formal proposal and pay commissions.

Setting up custom fields in Salesforce

The number of customized fields you can add will depend on the CRM you choose. Salesforce Essentials offers users the ability to add five custom fields in the Essential plan. Sign up for your free trial today to see how Salesforce can help you better manage the unique requirements of your business.

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5. Edit Your Business Proposal

First, proofread your proposal before sending it to a prospect. Whenever possible, send it to somebody else to read over. A second set of eyes can catch errors you may not see. Many word processing tools allow you to track changes on shared documents, giving you a record of peer comments or suggested corrections. You can always hire a freelance editor to review your proposal.

Second, pay attention to the tone and length of your proposal. In particular, make sure your proposal is short enough to read in a single sitting and contains language that is professional, yet clear.

Make Use of the Appendix

Any extra information, like testimonials, graphs, and charts, can be moved to the appendix. As far as the length goes, keep an eye out for repetition. Rather than emphasize your value proposition again and again, find a single example that drives your point home: “How much do we care about our customers? Our phone line is open 24/7 and we respond to all emails within 30 minutes or less.”

Business Proposal Tone & Language

Make sure you use clear, concise, and simple language that avoids industry jargon and technical terms. At the same time, avoid using hyperbole that exaggerates your company or service (“Our groundbreaking product quadruples sales”), as this may undermine the trust you are trying to foster with your potential client. In addition, use the same casual-meets-formal tone you would use in their office during a meeting.

There is one exception: Even if you’ve cracked jokes with your potential client, keep humor out of your proposal. This is because you never know who is reading the proposal. Often, it gets passed from a business owner to other employees, spouses, and even friends. A joke that lands well with your client may fall flat with somebody else.

6. Send Out Your Business Proposal & Follow Up

In the majority of cases, you can send your proposal via an email attachment. It is best to send it as an attachment rather than within the body of the email to reduce the risk that key details are lost in a long message chain or cut off when printed or forwarded.

However, some businesses may require you to log in to their portal and enter your proposal details or submit your proposal’s costs on their provided forms. In this case, it is still a good practice to email a copy of your business proposal, featuring your letterhead and formatted per your business requirements, to ensure that all terms and conditions are accurately captured.

If you’ve written a proposal before, you know the work is hardly over after you click “send.” Following up with a client to give them a reminder and to answer questions is a key part of the proposal process. We have written an article on several different types of follow-up messages you may use, as well as a range of example email follow-up templates.

Pro tip: Using email tracking software, receive a notification when the recipient opens your message. Follow up the next morning to see if they have any questions.

For example, Salesforce Essentials gives you the ability to track emails, calls, and meetings automatically with Einstein Activity Capture. These capabilities enable companies to follow the sales process, with detailed attention to the business proposal timeline.

Waiting for the perfect time to follow up should be a simple, but significant, part of your proposal strategy. A prospect will be far more open to a follow-up conversation when your proposal is fresh on their mind—whether they gave it a full read-through or a quick glance. Utilizing email tracking tools, like those offered by Salesforce Essentials, is another easy step you can take to master the follow-up process. Visit their website to start a free trial.

After You Win the Contract

While you might be thinking the challenge ends with a signed contract, this is not the case. As any small business owner can attest, it’s imperative to apply the same level of organization to implementation and ongoing support. This means answering questions that come up and executing on the deliverables outlined in your proposal.

Business Proposal Tips, Formats & Examples

There are many formats you can use to create a business proposal, depending on the needs of your specific business. While our downloadable template is a great way to help you get started, you should update it to include your company branding and unique offerings. The format you choose should be designed to capture a buyer’s attention and help your proposal stand out from the competition.

Business Proposal Tips

Here are several business proposal formatting tips:

• Hire a designer or use professional templates: Business proposals are more professional-looking when you use custom-designed templates or if you hire a designer to create them for you.
• Use callouts for important points: This can be done by using callouts to highlight how your solution solves your customer’s pain points.
• Use line items and bullet points: Using line items and bullet points make your business proposals less dense and easier to read. Making your business proposal easier to read increases your odds of it being read and perceived in a more favorable light.

Business Proposal Formats

Another alternative to consider when thinking about how to write a business proposal is to use a third-party business proposal service. These tools offer additional benefits compared to proposals written with traditional word processors, such as including electronic signatures, tracking notification, and even integrated credit card processing. We have written an article comparing some of the best proposal software for small businesses.

Examples of business proposals include:

Example Business Proposal #1

Proposify business proposal cover letter

Example Business Proposal #2

Proposify overview and goals business proposal sample

Example Business Proposal #3

Proposify itemized service proposal example

Example Business Proposal #4

Rocket Lawyer general contract example

Frequently Asked Questions (FAQs)

Should I set a deadline within my business proposal?

Generally, no. Unless there’s an actual time limitation, a deadline is just an arbitrary statement. All it does is put pressure on your client to sign the deal quickly. While this was a common sales strategy in the past, many small business owners have deviated from this philosophy today. Deadlines aren’t a great trust builder either, as they reveal your focus is on the contract itself, and not on the client’s needs and long-term well-being.

How long should a business proposal be?

As short as possible. If your recipient can’t read and digest your proposal in a single sitting (about eight minutes), chances are it will go back on their to-do pile, or get forwarded to another employee. The best case is this prolongs the sales process. Worst case, it pulls you out of the running.

What can I do to make my business proposal shorter?

Any extra information, like testimonials, graphs, and charts, can be moved to the appendix. Keep an eye out for repetition. Rather than emphasize your value proposition repeatedly, find a single example that drives your point home: “How much do we care about our customers? Our phone line is open 24/7 and we respond to all emails within 30 minutes or less.”

What is the difference between a simple & formal business proposal?

A simple business proposal can be either a written or verbal statement that outlines the generic cost of doing business, such as a ballpark estimate. A formal business proposal, also called a request for proposal (RFP), is a document that outlines the very specific needs, scope of work, or manner in which the work will be completed.

How should I handle solicited versus unsolicited proposals?

Solicited business proposals are when prospects and customers ask for a proposal. These should be handled by answering questions and addressing points your prospect asks to be addressed in your proposal. Unsolicited business proposals are ones you proactively send without a request and should show that you’ve done your homework and have a solution to a problem your prospect is willing and able to pay to resolve.

What are the key terms to include in my business proposal?

Fundamental terms to include in your sales proposal include price, payment terms, additional recurring expenses such as maintenance fees or other indirect costs, potential liabilities, and your cancellation policy, along with the effective date or time period the offer is valid. These terms should be written using clear language to avoid any misinterpretation.

Bottom Line

In terms of how to write a business proposal, the most important thing is to try to think like your client. If you can put yourself in their shoes, you will be better able to explain why your company is the best for the job and anticipate all the questions they may have along the way.

A CRM helps you keep track of your customer’s needs, but can also be a great tool for staying on top of open proposals. Salesforce Essentials gives you the ability to manage your contacts, leads, and even the proceeds resulting from successful deals, all within a single program. Sign up for a 14-day trial to learn how Salesforce Essentials can benefit your business.

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